Free Consultation

Can I trust the company which has offered me credit after bankruptcy?

I filed for personal bankruptcy last year . . . received my discharge a couple of months ago.

A few days ago I received, in the mail, an offer from Canaccede Financial Group offering me a new, unsecured, Affirm MasterCard. They apparently do know I filed for bankruptcy. On the face of it this could be a good thing as it will be a first step in helping me re-establish a credit rating.

However, upon investigating, I have found that this is a collection agency which has acquired a former MBNA account, one which was including in the bankruptcy. This kind of sets off alarm bells for me . . . although technically this debt no longer exists, why would the buy it from MBNA, then offer me credit?

Could this be just a back-door way of trying to collect on an old debt, even though it has been written off by the bankruptcy? I see reports of this, i.e. reviving old debts or zombie debts, happening a lot in the US, but not sure if things have sunk this low in Canada.

Posted from: Alberta

One Response to “Can I trust the company which has offered me credit after bankruptcy?”

Barton Goth, Trustee said...

I think you are reading too much into this. It is not uncommon for banks and credit institutions to send out mass mailings to anyone they have an address for. I think it is very unlikely that they are trying to target you, particularly as legally they could be in a lot of trouble for doing something like this. If an old debt is revived this is more often a mistake by the institution, or simply that the institution has sold all their old debt to a 3rd party collection agency and didn’t bother to look to see if some of it had in fact be cleared by a bankruptcy. So at this point, if you are nervous don’t use Affirm MasterCard, but it isn’t a bad idea of going somewhere else and applying for a credit card. My guess is you will need to start with a secured credit card as your credit will be poor and qualifying for a standard one will likely be challenging. But go to a place like Capital One or Horizon Plus, put $500 down on a card with a $500 balance. Then be sure to use the card each month (so it will report to the credit bureau) and pay it off by the end of the month (so you don’t have to pay any interest).